Henry Bellingham: Will the Minister confirm that business investment and productivity are falling and that England and Wales have both fallen in the world competitiveness tables? Whatever else happens in his discussions with representatives of small and medium-sized enterprises, will he confirm to them that the Government will ensure that Britain keeps its individual opt-out from the working-time directive? Will he confirm that to the House today?

Nick Ainger: Yes, it will. [Interruption.] As I said, there will be 200,000 new places in Wales alone. [Interruption.] Let me run through them. Dental care is establishing practices in Newtown, Brecon, Lampeter, Port Talbot and Swansea. There will be an additional 26,000 NHS places. Integrated Dental Holdings plans new practices in Llanelli, Wrexham and Whitland, where there will be 24,000 extra places. Oasis Healthcare will open eight new surgeries across north Wales, with 80,000 NHS places. There will be new surgeries in Denbigh, Mold, Ewloe, Flint, Rhyl, Caernarvon and Colwyn Bay. That is good news. There will be a comprehensive NHS dental system throughout Wales.

David Cameron: Oh, come on, don't be so coy. Let me put the question in a way that I suspect about 350 Labour MPs would like it put. When's he off?

Gordon Brown: It is a great honour and privilege to deliver a 10th Budget. Hon. Members may be aware that the last Chancellor to deliver 10 Budgets in a row was Nicholas Vansittart in 1822. In order to win the House's indulgence to be able to deliver so many Budgets, he did of course have to agree to abolish income tax. I regret to inform the House that that is a precedent that I do not intend to follow—at least this year. I can also tell the House that, for Mr. Vansittart, being Chancellor was preparation for his next important position in government: Chancellor of the Duchy of Lancaster.
	The British economy is strong and strengthening. I can report that inflation is currently 2 per cent. and on target. From the latest quarter, the economy is growing at an annual rate of 2.5 per cent. and on target, as we enter the 10th year of growth under this Government—the only Government in British history to be entering the 10th consecutive year of uninterrupted economic growth. With the world's pace of economic change accelerating, this is a Budget to strengthen Britain further for the global opportunities ahead: to lock in stability, but also to lead the world in new industries and technologies, which will increasingly shape our future; for British people, higher skilled jobs with higher wages, but also new choices for parents to balance work and family life; to invest in and reform public services, housing and infrastructure; and, building on the climate change levy, to meet the energy and environmental challenges. Most of all, this is a Budget for Britain's future to secure fairness for each child by investing in every child—a modern Britain that leads on enterprise and prosperity, because we lead in opportunity and fairness.
	For 50 years, Britain's economy was prone to high and volatile levels of inflation, and our first challenge was and is not just achieving low inflation today, but entrenching a culture of stability that allows Britain to invest for the long term. I can report that we have met our inflation target this year and every year since 1997; and looking five years and 10 years ahead, under current policies, inflation is still expected to be in line with our target. In just a decade, long-term inflationary expectations have virtually halved to 2 per cent., and today long-term interest rates are the lowest they have been for 40 years, at just 4 per cent.
	Indeed, even when facing in succession the Asian crisis, the IT bubble, an American recession, euro area stagnation and, most recently, the challenge of the oil shock and house price inflation—challenges which in previous decades led to British recessions—our economic framework for stability has proved resilient, robust and prudent.
	On Black Wednesday in September 1992—not so long ago, as the Leader of the Opposition will remember—interest rates reached 15 per cent. Since 1997, interest rates have averaged 5 per cent.
	Mortgage rates, which averaged 11½ per cent. between 1979 and 1997 have since then averaged just half of that at 6 per cent. I have said before: no return to boom and bust.
	In new measures, I propose to entrench stability today. We will continue to have the strength to take the long-term decisions that matter.
	First, since 1997, my approach has been that day-to-day management of monetary policy be independent of Government and the same principled approach be applied in other areas: to competition policy, industrial policy, small business policy and the management of debt. Today, I am publishing a new remit for the debt management office. Last year, our stability enabled us for the first time in a generation to issue bonds with maturities of up to 50 years. I can announce that in the next issue, long- dated gilts will increase from just under half to just under two thirds, reflecting the benefits we now gain as a country from long-term stability.
	Today, I am also publishing the detailed proposals, modelled on Bank of England independence, for official statistics to be the responsibility of an independent board,and forenhanced accountability to Parliament.
	I am also publishing today the new memorandum of understanding between the Treasury, the Bank of England and the Financial Services Authority so that Britain has in place the most up-to-date early warning and response system to deal with any risk to financial stability.
	We will continue to be vigilant over global imbalances and oil prices.
	We will take no risks with inflation at home. The public sector pay settlements will show settlements this year averaging just 2¼ per cent., combining fairness in pay, with more for nurses, with vigilance and discipline in the fight against inflation.
	It is Britain's new economic stability, and also our commitment to free trade, open markets and scientific progress, and our willingness to invest, that make our country better placed than ever to be one of the global economy's success stories. A year ago, some said that the doubling of oil prices would push our inflation far beyond target and that a recession was required to slow the increase in house prices. Instead, I can confirm to the House, as stated in the pre-Budget report, that growth will be 2 to 2½ per cent., followed in 2007 and 2008 by growth of between 2¾ to 3 ¼ per cent.
	Domestic demand is expected to grow this year by 2 to 2½ per cent., strengthening to 2¾ to 3¼ per cent. in 2007 and 2008. As industrial production grows, exports are projected to rise by between 5 and 5½ per cent. and 4¾ and 5¼ per cent. in 2007 and 2008.
	Since 1997, economic growth in the euro area has averaged just 2 per cent.—in France, just over 2 per cent; Germany, 1.4 per cent.; Italy, 1.4 per cent.; Japan, just over 1 per cent.—but in Britain, growth has averaged 2.8 per cent. a year since 1997. Britain stands with the USA and Canada as the fastest-growing economies of the G7.
	This is the 10th successive year that we have grown faster than the rest of Europe.
	In fact, we have not only achieved growth in every quarter of every year since 1997, but, averaging 2.8 per cent., our growth rate now is significantly higher than the 2.1 per cent. average of the period 1979–1997. Before we came to office, Britain was seventh out of seven in the G7 for national income per head. Figures published today show that since 1997, as a result of stability and sustained growth, Britain has risen from seventh to sixth, then to fifth, fourth, then third, and we are now second in the G7—second only to America in national income per head.
	The test of our monetary policy is that we are achieving sustained stability and growth not just for a year or two, but for the long term. The test of our fiscal policy is that we match a commitment to balance the current budget over the economic cycle with the ability to make the necessary long-term investments. Figures for the current budget from now to 2010–11 are minus £11 billion, minus £7 billion and then surpluses of £1 billion, £7 billion, £10 billion, and £12 billion in successive years.
	So we meet our first fiscal rule—the golden rule—and we do so by a margin of £16 billion. This £16 billion surplus contrasts with a deficit in the last economic cycle from 1986 to 1997—a deficit of £157 billion under the previous Government, and we are well placed to meet our golden rule in the next cycle too.
	The purpose of our second fiscal rule, the sustainable investment rule, to keep debt at a prudent and sustainable level of income, is to end the situation where, under Governments of both parties in the past, Britain was plagued, as everybody knows, not just by stop-go in the economy, but by stop-go in capital investment. So meeting our second fiscal rule allows us to combine stability with the necessary long-term investment in transport infrastructure, health, education and science. As a result of our success so far, total net public investment, which was just £5 billion a year in 1997, is this year £26 billion—five times as high.
	Schools capital investment, which was just £600 million in 1997, is £6 billion this year, and even after inflation we have invested £32 billion since 1997 in modernising our schools in just nine years, compared with just £14 billion in the 18 years before. We have invested twice as much in half the time. To meet the infrastructure needs of business we have been able to double investment in skills, transport, and science, yet even with such levels of investment vital to our economy, we are still comfortably meeting our second fiscal rule.
	Net debt is now 47 per cent. of national income in France and in America, 62 per cent. in Germany, 83 per cent. in Japan and 100 per cent. in Italy. This year in Britain it is 36.4 per cent. of national income. I can report that in future years debt will be 37, 38, 38, 38, and 38 per cent. of national income successively, so we meet our second rule over the cycle, and we do so by a margin of £26 billion.
	Net borrowing, which was £90 billion just over a decade ago, will be £37 billion this year, £36 billion next year, then £30 billion. It will fall to £25 billion, £24 billion and £23 billion in 2010–11 as we borrow to invest, borrowing in that year 1.5 per cent. of national income, compared with 8 per cent. just over a decade ago. In line with what I said in the pre-Budget report, net borrowing adjusted for the economic cycle will fall in future years from 2.4 per cent. of national income to 1.9 per cent. and then in successive years it will fall to 1.6 per cent., 1.6 per cent., 1.6 per cent. and then 1.5 per cent.
	For this Budget I received representations to increase investment in skills, transport, infrastructure and science. I also received representations that we should adopt a third fiscal rule, that over the economic cycle and regardless of the needs of the economy, infrastructure and services, public spending and investment must, as a matter of principle, always rise more slowly than growth. Having analysed this proposal against our published plans, I have found that it would require in the coming year public spending £17 billion lower than this year and £16 billion lower the year after, closing off the possibility of additional investment. I have rejected these representations.
	We are consistent that facing the economic challenge ahead we still, as a country, need to invest more. Meeting our fiscal rules and in line with our published plans, public investment to meet our infrastructure needs will rise from £26 billion this year to £29 billion next year, then 31, 32, 34 and 36 billions in the years ahead. And gross investment will rise from £48 billion this year to £63 billion in 2010–11. That sustained long-term investment in our education and infrastructure and in our future is possible because of the stability that we have achieved. So, Mr. Deputy Speaker, we can meet our fiscal rules, support the needs of business and make necessary long-term investments in, first, science, innovation and enterprise, secondly, infrastructure and transport, thirdly, security and the defence of our country and fourthly skills and education.
	I turn first to science, enterprise and innovation. With the right long-term decisions, I believe that Britain can lead in some of the fastest growing and highest value-added sectors—City and business services, education and health, creative industries and science-based industries. Once small, now one third of our whole economy and one third of our exports, soon those industries will have a much higher share of jobs and wealth. In each one of those areas, I am proposing today to do more to support the dynamism and enterprise of our businesses.
	I start with the importance of Britain's leading in scientific invention and discovery. The Secretaries of State for Health and for Trade and Industry are today announcing that to strengthen medical science and excellence in basic research, Britain will in future have a single budget for the Medical Research Council and NHS research, which will be worth at least £1 billion a year. America has its path-breaking national institutes of health, and we will now build agreement on the right design and institutional arrangements for a British model. To make best use of the additional £1.5 billion a year we invest in scientific discovery, we are proposing today a change of policy. We are setting out plans for a radically simplified allocation of the research funding that goes directly to universities.
	We are continuing our policy of making industrial policy more independent and at arm's length from Government. We will refocus around business's own priorities, and £180 million is now available for investment in cutting-edge technologies. Every advanced industrial country knows that falling behind in science and mathematics would mean falling behind in commerce and prosperity. So the Secretary of State for Education and Skills is announcing today a comprehensive programme for recruitment, retraining, retention and reward of 3,000 science teachers, a new entitlement to study the full range of science subjects at GCSE level and the funding of after-school science clubs starting in 250 schools. And to ensure that that investment is matched by performance in our schools, we will benchmark science results just as we now benchmark English and mathematics.
	Britain's stability and our commitment to openness and free trade make us well placed to attract business investment from around the world. In the past 10 years, business investment has grown on average at 5 per cent. a year, compared with 3.4 per cent. in the previous 10 years. Ten years ago, British business investment was £77 billion a year; this year it is £113 billion. We expect that in the next two years business investment will grow faster than the economy at 4.5 to 5.25 per cent. in 2007 and 2008, rising to £126 billion in 2008.
	Since 1997, there are more than 500,000 extra new businesses, and there are an additional 105,000 self-employed men and women. There is growth in every region, reflecting the dynamism and breadth of Britain's growing entrepreneurial culture. In the cycle that ended in 1997, productivity growth averaged 2 per cent. a year. In the current cycle, it is 2.3 per cent., which is a rate of productivity growth higher than at any time since the '60s—the result of our stability. After decades behind, Britain has caught up with Germany in productivity, is ahead of Japan and has halved the gap with France.
	In total, there are now 4.3 million businesses and 3.7 million self-employed. To meet and master global challenges, it is right today to do more to back our enterprise culture.
	To boost creative industries—soon to be 10 per cent. of our economy—as well as modern manufacturing, we are expanding the successful R and D tax credit by doubling the size of companies that can claim higher credit. With the aim of trebling our education exports, which will soon be £50 billion of our economy, we are signing new education partnerships with India, Russia and South Africa and China. To make Britain more attractive for overseas students, from May this year the Home Secretary will make it easier for those with specialist skills who graduate from English universities to work here for one year.
	Alongside a new City of London taskforce to promote British financial services globally, and backed by a new British advisory board and council, the Foreign Secretary and the Secretary of State for Trade and Industry are announcing a revamped UK Trade and Investment, which will set new targets for expanding trade with China, India and emerging economies, and for making Britain the location of choice for international business.
	Growing companies need venture capital, so we will refocus tax incentives for venture capital, with a 30 per cent. relief for investments in venture capital trusts. From today, twice as much investment as before will be eligible for income tax relief in enterprise investment schemes.
	Since 1997, corporation tax has been cut from 33p to 30p, small business tax from 23p to 19p, and capital gains tax for long-term business assets from 40p to 10p—a corporate tax system that we will continue to discuss with business and keep internationally competitive. I agree with employers who have suggested that for low-paid workers there is a case for better alignment of the national insurance and income tax systems, so we will conduct a review in time for a consultation after the pre-Budget report.
	Small firms with high growth potential also need equity finance, so I can announce £100 million of new money to double enterprise capital funds. Modern manufacturing in Britain will benefit not only from expanding the R and D credit, but the growing role of the Manufacturing Advisory Service and a smaller number of business services offering more targeted support.
	Today I can announce the formation of a national enterprise network of more than 200 schools: new summer schools in enterprise, including scholarships to American business schools for young British entrepreneurs.
	In the last Budget, I announced that Britain would pioneer risk-based regulation. Today, the Government publish our code based on a legal requirement for inspection only where there is risk. Risk-based regulation will work best if it is applied not only here, but in the European union. We are asking the European Council tomorrow to adopt the same risk-based approach in the interests of British and European competitiveness.
	Incomplete liberalisation of energy markets is one factor in high gas prices. So, again at the European Council tomorrow, we propose that all energy and other sectors which fail to liberalise and open up to competition be subject to independent investigation and enforcement.
	Nowhere does the current restructuring of the global economy impact more than on jobs and on skills. A Britain that thinks long term and thinks globally will not compete on low skills but invest in the higher skills. The new deal enacted the principle of an active labour market policy for any person out of work, and the economy has generated 2.4 million additional jobs since 1997. The claimant count, which was 1.7 million then, is today, even after recent rises, 920,000—800,000 lower. Britain has 75 per cent of adults in work, which is a higher rate than America or the European Union, and there are 170,000 more people in work than when I gave my Budget a year ago. If we had Euro areas levels of employment, we would have 3 million fewer jobs.
	But while other countries have yet to succeed in the fight against mass unemployment, the new deal in Britain is now rising to a new challenge. Today, the British economy has just 9 million highly skilled jobs. By 2020, it will need 14 million highly skilled workers. And of 3.4 million unskilled jobs today, we will need only 600,000 by 2020. Employers rightly tell us that their greatest long-term need is a skilled, flexible labour force. With the typical worker changing jobs seven times during a working life, investing in skills and the ability to re-skill will make Britain the most flexible economy of the future. So this Government will not abolish the new deal, which has helped more that 1 million people into jobs—we will strengthen it as a new deal for skills and jobs. The Leitch review is now considering a far-reaching proposal under which Britain can lead in skills: how to bring together at a local level employment and training services for not only the unemployed, but all who seek new skills.
	Thanks to the national employer training programme, 100,000 women workers are gaining skills for the first time. Following the recommendations of the Women and Work Commission, I can today announce new help for working women who want a wider range of career choices offering higher earnings and to close the pay gap with men. We will double available training for women with low skills, we will increase the work credit, and from October we will increase the minimum wage to £5.35 an hour. And we will address the unacceptable discrimination in women's pay.
	As the cities paper published today shows, our cities and largest towns are our biggest job creators, but they are also the home of most unemployment in our country. So the Ministers with responsibilities for communities and for work are setting out measures, first, to help 30,000 more lone parents into work and, secondly, to pilot partnerships with the voluntary sector and local authorities for thousands more jobs.
	We are well on our way to meeting our objective of 2 million new homeowners since 1997. After 160,000 hew homes built last year, there are now already an additional 1.8 million homeowners—something that has been possible because of low mortgage rates. But Government must also help to balance supply and demand. Our priority, as the Barker report recommended, has been: first, to speed up planning; and secondly, to release more public sector land, now and in the future, to build 100,000 more homes. To attract more capital into house building, we are now legislating to introduce for Britain the real estate investment trusts that are so successful in the USA. To help finance necessary new infrastructure, our policy is that local communities should retain more of the planning gains that are generated in their area.
	Britain is pioneering shared equity to bring home ownership within the reach of first-time buyers. The Deputy Prime Minister is today allocating £970 million for shared equity that will help 35,000 new homeowners get their first step on the ladder of home owning in this country. The Minister for Housing and Planning is inviting housing associations, local authorities, builders and building societies to offer shared equity, and we will now pilot minimum holdings as low as 25 per cent. We will also pilot a new scheme so that instead of tenants continuing to have to use housing benefit to pay their rent, the same money is used to bring sites back into use and to build new homes.
	The climate change levy, the resulting climate change agreements, and the Carbon Trust funded by it have cut carbon emissions in this country by a total of more than 28 million tonnes. That is why we are already able to meet our Kyoto targets. In each of the next five years, these climate change measures will cut emissions by more than 6 million tonnes, and, as the Prime Minister said, they will account by 2010 for 40 per cent. of our total carbon reductions.
	Because of the climate change levy, 10,000 businesses have signed climate change agreements. Under the Carbon Trust funded by the levy, 3,000 businesses have reduced their emissions. Enhanced capital allowances have underwritten investment in 13,000 energy-saving products. So I reject representations to abolish the climate change levy. I can confirm today our resolve to continue to reduce emissions, including through the climate change levy. Having kept the climate change levy at its original level for its first five years, it is my intention that for 2007 we index the climate change levy in line with inflation. As before, we will continue to return its revenue directly to business, and we will consult them on the most effective way of doing more to support investment in energy efficiency and the environment.
	Our supply of energy should be stable, secure, competitive and environmentally sustainable. With 98 per cent. of emissions occurring outside Britain, climate change is a global issue which demands global solutions. Our first ambition is an international framework, and I can tell the House that at the heart of this is this Government's plan to strengthen and extend beyond 2012, as the Environment Secretary has said, the EU emissions trading scheme.
	The developed world has a responsibility also to help developing countries meet their energy needs, so at the World Bank meetings in April, we will propose a World Bank facility—a $20 billion fund—for developed economies to invest in alternative sources of energy and greater energy efficiency for developing countries.
	We want also to be a world leader in the discovery and development of new energy technologies. Following a joint study with the Norwegian Government, we have found that carbon capture and storage in the North sea can reduce emissions from gas and coal power stations by 80 per cent. So we are today publishing proposals for industry-wide consultation to move this important environmental advance, which will cut emissions, from research to commercial development.
	Britain also has a unique opportunity to lead the development of all low-carbon technologies to meet the challenge of climate change. After discussions in recent weeks with some of the world's biggest energy companies, they have agreed to work in partnership to create for Britain a new energy and environmental research institute. For it to become, for Britain, at the cutting edge of science and engineering, our aim is that the public and private sectors together raise finance of £1 billion.
	Britain must lead not only in environmental research, but in the exploitation of new sciences. So to help British companies to commercialise new environmental technologies, we are setting aside an initial sum of £20 million as seedcorn finance for the first enterprise capital fund for the environment.
	The energy used in buildings accounts for nearly half of UK carbon emissions, so our next ambition is for Britain's homes and businesses to be the most energy efficient in the world. Regulations to take effect next month will improve the energy efficiency of new buildings by 40 per cent., compared with 1997 standards. But we will now do more. In the climate change programme review published next week, the Secretary of State for the Environment will announce additional incentives and cash support to pilot smart metering and a new labelling scheme highlighting the energy efficiency of consumer goods. And I can announce today, following an agreement reached this week with energy companies, a major extension of help for insulation—an additional 250,000 homes over the next two years. With every pensioner and low-income family eligible for special help, from 1997 to the end of this Parliament a total of 2 million more British homes will have been insulated.
	I can also announce a fund, initially £50 million, for microgeneration technologies which make it possible for homes and businesses to generate their own renewable energy. The purpose of this fund is to show how we can make these technologies, from wind turbines to solar heating, affordable to schools, housing associations, including local authority tenants, and businesses. Initially, it will cover 25,000 buildings.
	While half of carbon emissions come from buildings, a quarter come from vehicles. So today I want to do more to encourage cleaner fuels and cars. I propose to radically reform vehicle excise duty. I am introducing, to take effect tomorrow, a zero rate for a small number of cars with the very lowest carbon emissions, which will pay no duty at all. Instead of £75 for cars with low emissions, we will have significantly lower rates of £40. Duty rates from today will be zero, £40, and then £100, £125, £150, £190 up to a new band of £210 for the small number of new cars that are the most polluting—1 per cent. of all cars. This will help to pay for 5 million more fuel-efficient cars to have their duty cut. As a result of our decisions, and at an eventual cost of £10 million a year to the Exchequer, the duty paid on 50 per cent. of cars will be frozen or reduced from tomorrow. Instead of just 300,000 motorists paying £100 a year or less, 3 million will now pay £100 or less.
	To reduce carbon emissions further, 5 per cent. of fuel will be made from biofuels by 2010, with support and incentives that will, with the 20p duty differential, be worth up to a 35p per litre by 2008. It is our policy that each year fuel duties should rise at least in line with inflation, as we seek to meet our targets for reducing emissions and to fund our public services. But for the fourth successive Budget, because of high and volatile prices in the oil market, I propose to defer the usual inflation increase until 1 September. I will maintain the duty differential for rebated oils. And next week, when she publishes the climate change review, the Secretary of State for the Environment will set out her plans for a proposed annual carbon report. I can tell the House that the measures we announce today are essential for the progress in cutting carbon emissions that we all want to make.
	The Budget task is to strike the right balance between tax cuts that are affordable, investments that are essential, and stability that is paramount. In striking the balance between tax, spending and borrowing, I am able to do more for hard-working families. Taken together, child benefit and the child tax credit effectively mean no income tax liability for a two-child family with earnings up to £425 a week. So 3 million of Britain's 7 million families with children have their income tax liability effectively wiped out by this family tax cut.
	I have examined which tax decision could do most for families in future. We are raising the personal tax allowance from £4,895 to £5,035. One option would be to raise that personal tax allowance further. But spending £500 million on a family tax cut in this way would give a two-child family on median earnings of £24,000 a year £22 a year more, or 40p a week. However, using the same resources to raise the child tax credit will give that same family a family tax cut worth £140 a year more, over six times as much: £2.70 a week. So the best way to do most to help low and middle-income families with children, the best family tax cut, is to do as I will do today: to raise the child element of the child tax credit. Over the next three years, I will improve it by 14 per cent. For a family with two children, the child tax credit will be worth up to £88 a week in 2009, or £4,500 a year, a far bigger family tax cut than we could give if we used the same money to improve personal tax allowances or to cut the tax rate. Every one of Britain's 7 million families with children will gain as we raise child benefit on 10 April this year to £17.45 a week.
	Since 1997, we have also recognised that a rising economic tide does not automatically lift all people's living standards, and that over and above securing economic growth, we as a Government have a responsibility to address and cut child poverty. Because of investing in the child tax credit, child poverty has fallen by 700,000 in our first seven years. But we want to do more. It is by raising child benefits, as we have done today, and encouraging more single parents into work—as we have also announced today—that 300,000 children will no longer be growing up in poverty. Instead, they will have better chances.
	It is also our intention that every child born and growing up in Britain is not only freed from poverty but also has assets to their name. Since September 2002, every child born in Britain receives £250—for lower income families, £500—for their own individual child trust fund, to encourage savings. Today, with 1.5 million accounts already in being, I can announce that for these same children, additional payments of £250 and £500 will be made at the age of seven as well. This is an investment in the future, and in a savings culture among young people, that will in time allow all young people to have more of the choices previously available only to some.
	I understand the very real pressures that mothers and fathers face in affording safe, high-quality child care. In 1997, there was almost no direct help available for child care at all, other than for workplace nurseries. From April, working mothers and fathers can receive help through the child care tax credit worth up to £240 a week or, with the support of their employers, through the employers child care vouchers. That means help is available for working mothers and fathers at every income level, and it is the first time in Britain that we have made an offer of universal help for child care.
	The Childcare and Work and Families Bills will provide new rights to nine months' paid maternity leave and establish a new duty on local authorities to ensure child care places. But today I am also raising the value of the tax-free child care voucher from £50 to £55 a week. I am making capital grants available to medium and small employers to establish workplace nurseries, which will complement the rise from 6 April in the child care tax credit and the expansion of Sure Start children's centres from 700 now to 3,500 by 2010. Overall, that is an increase in child care places for families to 1.2 million—90 per cent. more than in 1997.
	I am able to take further decisions on taxation. On insurance premium tax, the aggregates levy, air passenger duty and corporation taxes, I propose that rates remain unchanged. On cigarettes, my decision is, for public health reasons, to go ahead with the annual inflation rise of 9p a packet from tomorrow. I will freeze duty on whisky and all spirits for the ninth successive year—for whisky, the longest period without an increase for half a century. I will implement, from midnight on Sunday, only the normal annual inflation rise of 4p on wine and 1p on a pint of beer. But in anticipation of World cup success this summer, I am freezing duty on champagne, and on British sparkling wine. I will also freeze duty on cider.
	On VAT, I will continue to help churches and faith groups by refunding VAT paid on renovation of church buildings, monuments and other sacred places. I will extend the special VAT scheme for horse racing. I hold to our pledge not to extend VAT to a number of items: food, books and newspapers, public transport fares, children's clothes and children's shoes, including flip-flops.
	I am publishing today a full updated list of the goods and services now subject to the reduced VAT rate of 5 per cent, and measures to tackle VAT fraud and avoidance. Last year, I proposed that the European Union should raise the duty free allowance for bringing goods into this country from outside the EU. This year, the European Commission has proposed to increase it from £145 to £340, but I am submitting proposals today for a further increase to £1,000.
	The tax-free limit for ISAs will remain £3,000 cash and £7,000 in total. I can report that £190 billion has already been invested by 16 million people. I can confirm as usual the tax-free winter allowance of £200 for pensioners and £300 for the over-80s. Further support for pensioners will be contained within the forthcoming pensions White Paper. I will raise the exemption on stamp duty to £125,000, which means, with the last Budget's measure and this, we have taken 400,000 homeowners out of stamp duty. I will raise the amount of inheritance exempt from tax over the next four years from £275,000 this year to £325,000—94 per cent. of estates pay no tax.
	Meeting all our fiscal rules, I have been able this year to cut vehicle excuse duty, continue the freeze on fuel duty, freeze spirits duties, take more people out of stamp duty, extend the family tax cut, child tax credit, and give more employers and employees tax incentives to cut the cost of child care, while at the same time improving tax allowances for business research, development and investment. Because of the strength of our fiscal position, I could cut further taxes while still meeting all my fiscal rules.
	In each Budget, instead of dogmatically imposing a third fiscal rule, I look at the merits of the case to get the balance right between tax, spending and borrowing. Therefore, in doing so, it is also right to consider the case for additional investment in the national interest. I turn to our priorities: finance for our important educational reforms; plans for the Olympics and sports; and, first, defence, law and order and national security.
	This is the first Budget since the attacks and tragedies of 7 July, a day when the nation stood as one against terrorism. We will never forget those who lost their lives and those who were injured. Today, we are allocating funds towards a memorial that will reflect the wishes of the victims' families. We will also support with an initial endowment of £1 million the creation of a new charitable fund to support British citizens injured in or affected by terrorist acts at home and abroad.
	Since 11 September, we have also doubled the budgets for security here at home from £1 billion to £2 billion. The country depends on the strength of our security services and our armed forces. To support our armed forces who serve us so well in Iraq, Afghanistan and other international commitments, I am allocating an additional £800 million. To promote peacekeeping in the most troubled countries of the world, I am today also setting aside an additional £200 million. I can also announce that the UN emergency relief fund, with starting finance of $250 million, will, at the instigation of the Secretary of State for International Development, immediately provide as its first major disbursement $30 million in famine relief to the horn of Africa, building on our own emergency contribution of $60 million.
	To deliver on the promises made at Gleneagles on aid and transparency, to move forward our international finance facility, and as part of the doubling of aid to Africa, I and fellow Finance Ministers from the IMF and World Bank will set out in Mozambique next month a new initiative that will be launched by President Mandela—and we are grateful to him—to finance new, detailed 10-year plans so that we can meet the millennium development goal of free schooling for every child by, and if possible before, 2015. Those initiatives are founded on keeping our promises to increase development aid each year to reach 0.7 per cent of national income.
	As the Prime Minister has said, 2006 must also see an ambitious outcome for the world trade round. To ensure that developing countries can both support the round and be beneficiaries of it, we will contribute to an aid-for-trade fund that will help build the infrastructure and capacity to trade in developing countries that are urgently in need of our support.
	The 2012 Olympics will be a proud moment for London and the whole of Britain. Together, the Greater London Authority, the Government and the national lottery have already agreed funding of £3.4 billion. I am able to announce the next stages. We will invest now in our 2012 Olympic champions. Recent results in Melbourne—and today, again, in India—have shown the outstanding sports talent that exists in our country. For training and facilities for world-class athletes of the future, I can announce £200 million of public money to be matched by raising £100 million in sponsorship, and, with another £300 million from the lottery, over £600 million will be available in total as world-class funding for world-class athletes in our country.
	The Olympics will inspire young people across Britain and we must open up to them new opportunities to take part in sports. So we are also announcing that each year, from now until 2012, there will be a schools Olympics. Starting in Glasgow this year, and in a different city each year, we will fund annual national competitions in Olympic events open to all schoolchildren throughout the United Kingdom.
	The 2012 Olympics is for athletes to excel in, but it must also be an event in which all in Britain can share. Today, we are also announcing an Olympic trust fund for nationwide cultural and sporting events, which will take place alongside the Olympics. The games will end in 2012, but their legacy must continue, and it should benefit not just London but the whole country.
	Because we want the 2012 Olympics and, beyond that, any English bid for the 2018 World cup to regenerate sports across our country, I want us to build in every area over the next decade public-private partnerships that can locally renovate and extend sporting facilities at the grass roots. We are today announcing initial funding of £34 million for a new national sports foundation. It will start next week, modelled on the Football Foundation's success, and will bring together public and private finance for new local sports facilities and grass-roots participation. I am also setting aside £2 million for a new venture between police, premier league football clubs and community groups, with the Football Foundation, to offer young people evening sports and to tackle antisocial behaviour.
	Following the Russell commission which I set up two years ago, the new gap-year and volunteering scheme, youth national community service, will be launched in May with 26 company partners, a budget of up to £150 million and a target of 1 million young volunteers. It will be backed by youth community service on environmental projects, to be financed by an expansion of the landfill tax credit scheme.
	But we must also do more to invest in youth and community facilities, both for the future—where banks and building societies have agreed, unclaimed assets will go to finance new facilities—and from next month, when in each local authority with budgets averaging half a million pounds, young people will for the first time decide on their own local services. I propose that we extend that with a new challenge fund open to all young people proposing innovative projects for youth and community facilities in their area—additional cash to reward innovation and spread best practice across the country.
	Further to support that and the voluntary sector as a whole, which are at the heart of the life of every community, we will now set up in the Treasury an office for the voluntary sector, including faith as well as non-faith charities. It will advise on gift aid and futurebuilders, and will conduct a nationwide consultation with the voluntary sector to inform our spending decisions.
	But as well as making these additional investments, this Budget will now start the process of setting out our priorities and plans for the next spending round and the years ahead. Our aim must be to ensure by our investment that hard-working families are the beneficiaries of this era of great change. It is right to have the fullest possible debate on spending priorities.
	A decade ago, our first comprehensive review reflected the British people's priorities for education, health and public services. Today I am publishing plans to begin a public debate on our second comprehensive spending review. But there are already two areas in which, by setting out our direction now, we can best deliver our priorities in the future.
	In order to release new resources for our priorities—central to which is building world-class schools and education—we are reviewing the use of assets in all areas. After asset sales reported at £6 billion last year, we plan total sales by 2010 of £30 billion, releasing finance for our front-line priorities. In addition, I can confirm that the sale of Westinghouse will be completed in the next year, and we expect it to raise £3 billion.
	The Government will move ahead in the coming year with the sale of the Tote. To diversify risk further and after the energy review has reported, we are prepared to sell part of our stake in British Energy and related energy assets. We will publish plans for the sale and release of public spectrum. All those decisions will release new money for our priorities for the future.
	Also published today are the figures for the first £6 billion of Gershon savings, including a reduction in civil service posts of 40,000. And I can announce today further savings in the years of the next spending round from 2008 to 2011.
	The Home Secretary has agreed that we can invest more in priorities like policing and security, while making savings in other areas within a three-year budget at its 2007–08 real-terms level. Her Majesty's Revenue and Customs, the Treasury, the Department for Work and Pensions and the Cabinet Office have also agreed that necessary modernisation will be funded from an innovation fund, and alongside this the spending review for those four Departments will proceed on the basis of minus 5 per cent. a year in real terms below the baseline of 2007–08—efficiency savings that will allow us to focus new and additional resources on front-line priorities.
	To meet and master the global challenge, the most important investment in our economy and our future and the most pivotal reforms we can make will be in the education of our children and young people. I, like so many people, am grateful for the inspirational teachers and the high quality of education from which I benefited. And just as I had the best chances, my aim is that all young people from whatever background have the best of chances.
	There are two priorities where, in this Budget, Britain can speed up our progress and advance even more quickly towards our ambition of world-class standards and excellence. With China and India turning out 4 million graduates a year, we can no longer afford to write off the talent or waste the potential of any British young person. So the Secretary of State for Education and Skills is announcing today that those who have missed out on their first chance in education will have a second chance to make the best of themselves. We are setting aside resources so that, for the first time, up to the age of 25, further education all the way up the scale to A-level standards will be free of charge.
	That new right to free learning will be backed by adult learning grants to help with costs of living. And with financial help also for school leavers who have fallen through the net—and whom we want to help make the transition into training and work—our aim is a Britain where all young people stay on in part-time or full-time education, and gain skills throughout their working lives.
	But 80 per cent. of the 2015 work force is already in work, and to make a reality of second chances in education for all ages, we must also strengthen our further education colleges—centres of learning that have been neglected in the past, but must be at the forefront of future success. So we are announcing for each college a step change in employer involvement, so that we can match the demand for skills to the courses on offer. The Secretary of State is also announcing new powers to redirect resources from failing courses to the best courses, the ones that individuals, employees and employers want to use.
	We will match these further education reforms that promote individual choice, increase local accountability and business engagement and reverse failure with £500 million of capital investment and an annual budget worth £7 billion by 2008. As with other allocations, separate announcements will be made for Scotland, Wales and Northern Ireland.
	But while we have a duty to ensure that there are second chances, we also have to ensure for every child the best first chance. Even with a doubling of investment, Britain's share of national income spent on education is still behind America and other major competitors.
	We know the educational benefits of more individual attention, small group teaching and tuition, and we know that they are easier to get when the overall teacher-pupil ratio is low. In private schools there is one teacher for every nine pupils, compared with one teacher for every 16 in state secondary schools. To secure better results, we have improved the pupil-teacher ratio and doubled the money spent per year for the typical pupil from £2,500 to £5,000.
	But that figure of £5,000 per pupil still stands in marked contrast to average spending per pupil in the private sector of £8,000 per year. Our long-term aim should be to ensure for 100 per cent. of our children the educational support now available to just 10 per cent.
	So to improve pupil-teacher ratios and the quality of our education, we should set as an objective for our country that stage by stage, adjusting for inflation, we raise average investment per pupil to today's private school level. And I can start immediately in the coming spending round by closing today's gap between capital investment for pupils in private schools and in state schools, so that all schools and all pupils have world-class IT and world-class equipment, teaching materials and buildings. So in the coming five years, investment in schools will rise from £5.6 billion a year to reach £8 billion a year—a 50 per cent. rise, making a total of £34 billion of new investment over five years.
	By 2011, annual investment in the typical child's education will be over £1,000 per pupil, matching in state schools—in IT, equipment and buildings—what private schools spend today, and demonstrating, fully within the discipline of our fiscal rules, that by investing more in education and investing not a lower share of our national income but a higher share, we can make a practical reality of our goal that every child should have the best possible start in life. It is a goal we could not achieve if bound by a fiscal rule that cut investment, but a goal we can achieve if we build a national consensus around a rising share of investment in education.
	I have further announcements to make. This Budget's choice is to invest more, not less, in schools and families; to strengthen the new deal, not abolish it; to maintain the climate change levy, not remove it; and instead of cutting investment, to hold firm and not waver on the principles that have given Britain stability and jobs, and now allow us to do even more for our priorities.
	To tackle crime and the fear of crime, there are already a record 140,000 police officers and 6,000 community support officers. In 1,000 neighbourhoods, there are full community policing teams. But the Home Secretary and I want every community to have a community policing team as soon as possible. So, at an additional cost of £100 million, we will ensure by April next year that we more than double the number of community support officers from 6,000 to 16,000, and ensure that there will be neighbourhood policing in every community in England and Wales.
	From 1 April there will be free local bus travel for every pensioner and for disabled people, but we believe that there should also be free national bus travel. So the Transport Secretary is announcing today, from April 2008, at a cost of £250 million, for every pensioner and for disabled people free off-peak national bus travel in every area of the country.
	I have one further announcement. In 1997, there was no payment at all direct to primary and secondary head teachers. With £270 million extra from April, rising to £440 million next year, I can today put much more money than before direct to our schools for tuition, teachers and teaching support. There are those who say—as with the £1.5 billion that I have already found for law and order, policing, security, environment and the Olympics—that this £440 million for education should be used to cut taxes. I could, of course, afford to do so, but I say: investing in education comes first, and investing in education is this Budget's choice. So for the typical primary school, up from this year's £31,000, £44,000 will go direct to the head teacher. For the typical secondary school, up from this year's £98,000, from next week £150,000, and next year £190,000—twice what it is now. For the largest secondary schools with the greatest needs, from £260,000 to £365,000 next week, rising to £500,000 next April. Next year, £440 million more will go direct to schools, helping pay since 1997 for 30,000 more teachers.
	Excellence in education, my priority; more investment and reform, not less; a strong and strengthening economy; this is a Budget for Britain's future and I commend it to the House.

Mr. Deputy Speaker: Order. I am sorry to interrupt the right hon. Gentleman. The Chancellor was listened to with very—[Interruption.] Order. The hon. Member for Glasgow, North-West (John Robertson) will be removed if he behaves like that. One expects a certain reaction to these things, but the Chancellor was heard in relative silence and same courtesy should be offered to the Leader of the Opposition and to the leader of the Liberal Democrats afterward.

John McFall: The hon. Gentleman has conflated two issues. On the first issue, I believe that some 85,000 workers are involved, including some of my constituency. One can have nothing but real sorrow for their plight. However, when it comes to macro- economic issues and Government commitments on public expenditure, it is evident that neither the Government or the Opposition are willing to make a proposal. My right hon. Friend the Prime Minister asked last week whether the taxpayer should pick up the bill for those schemes. I accept that point, but I hope that discussions will continue because it was only yesterday that many of those affected came to lobby us on that issue.

John McFall: I recommend that the hon. Lady does what I and several other hon. Members have done. In conjunction with the Pension Service, we have held meetings in our constituencies to encourage people to apply for the pension credit. The Department for Work and Pensions has been very helpful to me and other hon. Members in organising such open days.
	The Turner commission report raised two or three other important issues, including industry regulation. We know that the industry's commission-based model has produced inherent conflicts of interest that successive Governments have used regulation to manage. The mis-selling scandals led to tighter regulation, which, while protecting some consumers, has increased distribution costs and made it uneconomic for the long-term savings industry to service consumers on below-average incomes. Embracing the needs of lower-income consumers is one of the issues with which Turner, the Government and others will have to grapple. As Turner pointed out,
	"it is very difficult for the financial services industry to sell pensions to people of average earnings and below, working for small and medium size companies, or even to sell pension schemes to their employers, at annual management charges sufficiently high enough for them to make a profit but sufficiently low enough to represent good value for money for the person saving".
	That highlights the need for two solutions: first, the Government need to make the pension system simpler, to reduce the cost of regulated advice; and secondly, the industry needs to develop and encourage the take-up of simple, low-cost stakeholder products for that larger market.
	The Financial Services Authority has a role in that regard. It did not go as far as it could on simpler regulation for stakeholder products—we have to get regulation right before we start considering the management costs, which must be low. Turner recommended 0.3 per cent. and at the weekend Aviva became the first insurance company to propose a figure, which was 0.6 per cent. However, we should be striving to reach Turner's figure.
	The fiscal policy framework has stood the test of time. The Chancellor mentioned that the golden rule had been met, but the Treasury Committee and the International Monetary Fund consider that current fiscal rules may need strengthening towards the end of an economic cycle, to reinforce the credibility of the framework. The Committee will reconsider that issue over the next few months.
	Some of the challenges to the framework will come in the form of the spending pressures to which the Government will have to respond in the 2007 comprehensive spending review. Their capacity to do so successfully will be enhanced if their preparations are transparent and Members and Select Committees can both examine and contribute to the process, so I welcome the announcement about independence for the Office for National Statistics. I received a letter about the proposals from my hon. Friend the Financial Secretary to the Treasury, which stated that the Government are
	"entrenching independence in legislation . . . introducing direct reporting and accountability to Parliament, rather than through Ministers".
	So I presume that it will be through the Treasury Committee. The letter noted that the Government were
	"placing a statutory responsibility on a new independent governing board to assess and approve all National Statistics against the code of practice, also backed by statute"
	and
	"making key appointments to the board through open and fair competition".
	As the Minister knows, an open and fair appointments system is important. Next year will be the 10th anniversary of the establishment of the Monetary Policy Committee, which may be a good time look at openness and transparency in appointments to such bodies. Given our experience of the work of the MPC over the past 10 years, I want Ministers to anticipate issues and problems, so that if they come up in Parliament the appointments system can be seen to be open and fair.
	It is important that statistics services are seen to be independent. In February, a MORI survey of public opinion on statistics for the Statistics Commission found that there was
	"little consensus on whether the statistical service is subject to undue influence from the Government. Many, in particular those with a connection to Parliament, are confident that the statistical service operates independently and with integrity".
	I am sure that we would find that view in the House—but it is not the House that matters, it is the outside world. The survey continued:
	"However, for those outside the 'Westminster sphere of influence', there is far more scepticism as to whether this is actually the case. While most still regard the ONS as an authoritative, trusted source of information, there are doubts over the validity of figures produced by individual Government departments."
	As the Finance Bill goes through the House, it is important that Ministers take account of that point, which will also be of interest to Members in Committee.
	The Chancellor was correct to stress the measures we need to adopt to enhance the UK's global competitiveness. That is welcome, not least for women. The Women and Work Commission produced a report in February, "Shaping a Fairer Future", which set out 40 practical recommendations to tackle job segregation and the gender pay gap, which still exists despite 30 years of equal pay legislation. The only way that we will respond to global challenges on competitiveness is to ensure that we upgrade our skills, so I welcome the continuation of the new deal and the upgrading of skills, especially for women in low-paid employment.
	The Treasury Committee has been seized by what globalisation will mean for the UK. We have undertaken an inquiry into globalisation, to which both the Governor of the Bank of England and the Chancellor have agreed to give evidence. Part of our inquiry will look at the role of the IMF. The Chancellor and the Governor—in a speech a month or so back—have both focused on the IMF, about which there are a number of fundamental questions.
	What is the fund for? Do we need an IMF? Is there a role for a multilateral monetary system and, if so, what is it? In 1946, the international monetary system was built around fixed exchange rates and controls on capital investment, and each country met its international responsibilities by running a balanced current account. That is a world away from the situation faced by financial services in the 21st century. The IMF is increasingly seen as the lender of last resort, and until the repayment of loans by Argentina and Brazil, 70 per cent. of its outstanding loans were to only three countries. The IMF lending book is the lowest that it has ever been, and we can be sure that the Asian economies, including Japan, having built up their foreign exchange reserves, will not be coming back to the IMF. They were scarred by the experience of the 1990s.
	The IMF has a number of tasks, especially at a time of such massive global imbalances. It should be a forum for transparent discussion of the way forward with national Governments about risks to the world economy. Recently, the Treasury Committee visited the United States where we had the opportunity to talk to a wide number of people. One issue relating to economic risk is trade protectionism, and the possibility of its being translated into policy change in the US should not be dismissed. It is a risk and a Bill proposing further protectionism is currently before Congress. However, it is important that we emphasise to our US colleagues that protectionism will not get us anywhere.
	There is also a risk of sharp adjustments in US current accounts spilling over to sharp adjustments in assets, markets and energy prices. The high and volatile energy market remains a concern in a globalised world where new alliances are being formed in the global economy.
	A new world order has been established, as people have indicated, and the US economic hegemony is being challenged by the rise of the new economic superpowers, so an understanding of global economic development no longer needs to begin in Washington—hence the Treasury Committee in its inquiry has already visited China and, in June, hopes to visit India, which has been labelled the new China. I will not go over all the statistics on China—most hon. Members are familiar with them—but the UK needs policy responses to them.
	The Government have indicated that they have a UK-China task force and have identified five key issues, with which I agree—energy, financial services, water, health care and information and communications technology—but I suggest to Ministers that we should also take on board both education and legal services. On a visit to Hong Kong in September, at the invitation of the Hong Kong Government, it was obvious that there are opportunities in education and legal services, and Hong Kong is a good base for us to be involved in that exercise.
	We have globalisation at a time of threats in the US and in Europe. We saw the almost xenophobic response by people in France and Belgium to the possible takeover of the steelmaker Areclor by Mr. Mittal. We saw the US reaction to the P&O takeover by Dubai Ports World. Only in the past couple of weeks, we have seen the locking out of an Italian energy company by the French, who designated 11 sensitive sectors that must be safeguarded against foreign bids.
	We must avoid a perilous collision between nationalism and globalisation. Therefore, it is very important to have a cross-party view on the issue so that we can respond to the long-term challenges, which have a habit of coming sooner than we expect. The Chancellor is right to focus on those long-term challenges, but we also have short-term challenges, on which the Treasury Committee will, no doubt, examine the Chancellor. Over two and half hours, all of us who serve on the Committee will have an opportunity to pinpoint those issues.

John Redwood: My hon. Friend is right to extend my argument even further. He is pointing out that we should account properly for not only borrowings that are guaranteed but not in the documents, such as the railway borrowings, and the contingent liabilities of all the PPP and PFI projects, but the massive contingent liabilities in the pensions area throughout the public sector.
	I will accelerate my argument because of my hon. Friend's question, although I was going to refer to this matter later. The Government have just said to all private businesses that they must not only have recent calculations of the deficits in their pension funds, but write those deficits on to their company's balance sheets. I understand the logic of that, and FRS 17 is the standard under the Government's requirements. My plea is not that the rule is changed for companies, but that the same rule is applied to the Government. It is obvious that the Government have a massive deficit on the pension account because they—Governments of all parties have done this over the years—have built up huge liabilities, but not provided any assets on the other side of the account to pay for them. We need honest public accounts that match the clarity and honesty of private sector company accounts to show us the contingent liabilities of all the pension funds.
	The Government may well counter my point by saying that one can deduce, by reading carefully the Red Book and other sources, the annual payments under the PFI and PPP contracts. However, that is not sufficient because it is a flow—an income statement—for each year. We need to know the contingent liability, which is how many times the income must be paid to get rid of the contract, or how much would have to be paid to rescue the contract if the company went bust or the contract went wrong. It is how much would need to be paid to reinstate the service if there was a breakdown. We need an accurate figure for that kind of contingency.
	We know that sadly such contracts go wrong from time to time. We can expect new Governments to be elected who would like to change the arrangements, but there would be a substantial price for doing so. For example, it might prove penal to get out of the London tube contract because it is very bad. We need on the face of Government accounts a clear statement of what the contingent liability costs of all the private arrangements would be, in addition to the guaranteed borrowings and the pension liabilities.
	My concluding point on debt is simple and echoes the comments of my right hon. Friend the Member for Witney. We are borrowing too much as a nation both through the public accounts and outside the public accounts under Government initiative and with Government encouragement. As a period of moderate to reasonable growth of the economy is forecast, we ought to rein back that debt more quickly.

Christopher Huhne: Clearly, there would some home currency questions, but the idea that it was one for one is simply absurd. There is no support for that in any literature or in what happened.

John Redwood: I was going on to say that it clearly did not. In fact, it did the opposite. As a result of that, a large number of companies—well intentioned towards their work force—have said, "We can't afford this anymore, so we are going to close our funds." In some tragic cases, as we heard recently in the House, funds have folded altogether because a company has gone bust or is unable to make the contribution, and the funds do not have sufficient money to meet the requirements. A new generation of people who are going into work or are in junior positions in industry or commerce no longer have access to a final salary scheme. They are probably saving proportionately less, with the help of their employers, than under the old regime.
	Worse still, the regulators and actuaries now say that because those funds are very mature, they should be invested not in equities, but in bonds. They have triggered either a mass exodus out of shares into bonds, or they have persuaded or required funds to buy only bonds and not shares. We now have a huge build-up in bond commitments and a run-down in equity commitments. That has had two unforeseen consequences—I think that they must have been unforeseen; I should not think that the Government wanted them.
	The first unforeseen consequence is that corporate Britain is up for sale because equities in Britain appear to be relatively lowly rated compared with equities elsewhere. Many great British companies are successfully bid for from overseas because the natural buyers of shares—the pension funds—are not there to take the values up to levels that overseas buyers would find less attractive. We have seen O 2 , P&O, BOC and various others companies sold out, for premium, to overseas buyers because the UK equity market is relatively lowly rated—a direct consequence of the tax raid and the pension fund position. I see Labour Members getting uncomfortable. They obviously do not like corporate Britain being bid for, but they have no other explanation.

John Redwood: The Minister is heckling me, but he clearly has not studied Conservative policy carefully enough. The Leader of the Opposition is keen to preserve all the great grammar schools in this country and in Northern Ireland, as I am. He is keen to introduce sensible selection in our comprehensive system, and effectively to create a grammar school stream at the top of every comprehensive, which is a very good way of raising quality. Indeed, it is the Minister's own policy for certain disciplines, such as modern languages, where he does believe in selection on aptitude, which is another word for ability, as we all know. When I asked the Prime Minister what the difference was between aptitude and ability in modern languages, his answer was notably deficient. I am glad that the Chancellor, in the guise of the Secretary of State for Education and Skills, said that more needed to be done in further education. He said that we need to take skills education much more seriously, and we may find common ground in trying to achieve such improvements.
	The Government could make an important contribution to improving our productivity and efficiency if they sorted out a couple of things for which they have prime responsibility. They have been in power for nine years, but we still lack an energy policy. They play an important role in energy, as they need to send the right signals in their tax and market-influencing policies, and they issue planning permission for new power stations. The Chancellor glided over the matter in his speech and in the document, but it is high time that we had an energy policy. If we wish to develop process industry in this country we need better answers on energy availability and price. In the past few weeks, there has been too much reliance on the spot price, which has gone all over the place because of the imperfections of the continental market.
	The Chancellor and the Secretary of State for Trade and Industry have both said that the Government intend to push for proper competition inquiries in Europe to try to free the market so that we can achieve access to a good supply of gas and other power at sensible prices. When will the Government persuade their partners to do so, and when are things going to be open? This is an urgent matter—it is no good saying that it may happen next year.
	The Government often play a lead role in transport. We have a 21st-century economy and a very good private sector, but we have a mid 20th-century transport system that is in desperate need of more capacity and modernisation—a word that the Government usually like but which they misinterpret. I hope that they will soon come up with a way of increasing transport capacity on both the road and the rail system, and I hope that it will harness private finance. I am not putting in a bid for extra public spending, as a huge amount of money is available for sensibly worked-out road schemes to expand transport capacity. The bipartisan project for the relief road around Birmingham offers a good model, and we need more of those projects. I hope that the Chancellor accepts that if we are to improve the country's economy and productivity we must tackle those road blocks, which hinder the movement of goods and people.
	Finally, I would like to raise the issue of regulation. In his Budget statement and in the supporting papers, the Chancellor talked about the need for better regulation. Indeed, at times, he even talks about the need for deregulation. In the past, I have warmly welcomed his conversion and that of the Prime Minister to the view that we are a greatly over-regulated society. I welcome their conversion to the notion that certain regulations are unnecessary—some of them achieve the opposite of what they set out to achieve and other regulations are simply too expensive, given the aims that they set themselves.
	We have heard fine words and speeches, and the first of two promised Bills on deregulation has finally been introduced. It is therefore an enormous disappointment that there are two problems with the Legislative and Regulatory Reform Bill. First, it does not include any provisions on deregulation. With the agreement of all my Conservative colleagues, I have proposed 63 things that we would like to deregulate immediately. Personally, I could cite another 100, and I may persuade my colleagues to back them in due course.

Rob Marris: I will go so far as to say that some economic indicators, including falling unemployment, were positive on 1 May 1997. However, the suggestion that at that point the United Kingdom was somehow the economic powerhouse of the European Union—or the most powerful economy—would be questioned by 60 million west Germans, and probably 80 million Germans. I stand to be corrected, but many people would agree, without picking any other examples, that the German economy in May 1997 was stronger than ours. Our economy now is stronger than the German economy—because our economy has come up, not because the German economy has come down.
	We have been talking about productivity and I very much welcome the statement on page 15 of the Budget 2006 "Budget Notes", dated 22 March, in relation to amendments to research and development tax relief schemes. It is important to companies in the west midlands and, I hope, to all right hon. and hon. Members, to encourage more research and development and consequently, one hopes, investment in our economy. Paragraph 2 states:
	"In line with a key recommendation of the Cox review"—
	I do not know who Cox was—
	"the Government intends to provide additional support to firms with between 250 and 500 employees through R&D tax credits, subject to the outcome of state aid discussions with the European Commission."
	That is extremely helpful. In previous years, the Government have gradually extended the scope and amount of R and D tax credits, which has not yet had as positive an effect as one would hope, but it is having a positive effect. R and D is creeping up, I would like it to increase further and that segment of companies with between 250 and 500 employees could be a real driver of that increase. I hope that that helps manufacturing around the country, especially in the west midlands.
	To move on to the green agenda, I declare an interest as a member of Greenpeace since, I think, 1975. I have a feeling that I am also a member of Friends of the Earth. I will declare that because I think I am a member, although I am not sure.
	I am pleased that the Government introduced, and are sticking with, the climate change levy. I am saddened that the Conservative Opposition seem still be wobbling about it. In fact, as far as I can tell—perhaps a Conservative Member will elucidate—they seem still to be against it. Despite difficulties in what might be called the fine print, I think that it has had a positive effect.
	The right hon. Member for West Dorset (Mr. Letwin), the former shadow Chancellor, said in January that the climate change levy had not been a success.
	That followed his statement in July 2000:
	"We regard the climate change levy as an aberration that should never have been brought before Parliament."—[Official Report, 18 July 2000; Vol. 354, c. 322.]
	He was very clear about that. I think that he was also very wrong, and I urge the Government to stick with the climate change levy. It is a pity, however, that there has been no change in airport passenger duty. I think that we should continue to push within the European Union for some kind of excise duty and also duty on aviation fuel.

Rob Marris: Every little helps, which is why the Chancellor has announced what I hope is an initial fund of £50 million for microregeneration. That is how it works with energy: every little bit helps, whether people are driving fewer miles and cycling more, whether we have microregeneration, or whether we have a few more windmills. Hon. Members need to grasp that we are talking about a whole mosaic of measures. Any one measure will not sort everything out; we need an array of measures. That is what the Government are providing and what the Budget has provided.
	Investment in energy efficiency for buildings, both business buildings and homes, is part of that array of measures. We have buildings—this applies, I have to say, to parts of this building—that are leaking energy all the time. Lights are left on, and there is insufficient insulation. We as a society need to invest in energy efficiency in the public sector, in the private sector and in our own homes. We are starting to do so and yes, I wish that we had done more earlier, but one has to have priorities in government and they were sorting out schools and the NHS, economic growth and so on. We have done pretty well on those and now we are moving on to energy matters.

Kevan Jones: I am listening very carefully the hon. Gentleman. Is he really saying that if a part of the economy is not productive, it does not make any contribution? I have to totally disagree with him in terms of the armed forces. Surely by trying to protect the security situation in different parts of the world, they are helping the economy not just of this country, but of the parts of the world in which they are serving?

Alan Simpson: The architect and I will have lots of fun doing just that.
	One of the things that experience taught me is that there are no individual solutions. My contribution to energy generation would be infinitely more efficient if it could be fed into a decentralised energy system for Nottingham, in which co-generation—the interaction between the energy needs and energy generation of houses, shops and businesses—was part of an integrated whole. We shall achieve that only when fiscal measures make such a shift possible. That is an admission of the limits of the contribution I can claim in lightening the ecological footprint of my existence on the planet. My contribution would be much more significant if my footprint was lightened alongside others and in conjunction with them.
	In budgetary terms, we need to look at the management of markets and the management and deployment of fiscal incentives on energy. Recently, we handed out a public, taxpayer subsidy to clear up the £85 billion waste management costs of the last generation of nuclear power stations. Soon, we shall be asked to believe that there will be no similar costs in future for a subsequent generation. I have to say to the Chancellor, his colleagues and colleagues on both sides of the House that the public, taxpayer subsidy for that next round of follies would run off with the budget for all the other interventions that would bring about fundamental change and a sustainable energy system for the UK in the 21st century.

Greg Clark: It is a privilege to follow the thoughtful speech made by the hon. Member for Nottingham, South (Alan Simpson). Perhaps I should pay tribute to the Chancellor for his 10th Budget statement because delivering 10 Budgets in a row is not to be sneezed at. His statement seemed very familiar in some ways. Perhaps it is like an ageing rock star taking his greatest hits on tour year after year, albeit with a slightly dwindling audience, at least on the Labour Benches. I pay tribute to the Chancellor for his achievement.
	When I started my career in business, I worked for the Boston Consulting Group. A few days after joining the company I was sent to south America to investigate the market for breathing apparatus among fire brigades in the Argentinean pampas—it was a fairly exotic mission. Owing to long flights and delays, I had little time after getting back before I was required to present my report to our client. Just before we were about to do that, the senior partner called me into his office and looked at my report. He jabbed an accusing finger at a number in the document that he chose at random and said, "Greg, how did you come by that figure?" I was required to explain how I derived the calculation and, fortunately, I passed the test because I was able to explain exactly where it had come from. The senior partner was making an important point because if I had not been able to give an explanation, no other figure in my report would have been of any worth whatsoever. If I could not explain every figure, there was no point presenting the report to the client at all.
	When I came to the House, I assumed that there was a similar process when the Chancellor of the Exchequer presented figures in his annual Budget to Parliament. I assumed that there was an equivalent of the senior partner who went through the Budget figures. It might have been that the Chancellor himself asked his officials who are in the Box today how the figures were derived. If not, perhaps the Prime Minister had the papers laid out on the Cabinet table and, pointing to a figure, said, "Gordon, how did you get to that number?" Whatever the process, I assumed that if a report on breathing apparatus in Argentina could merit such scrutiny, anything presented to the House by the Chancellor of the Exchequer in the annual Budget should merit exactly the same treatment.
	I was thus interested when the Chancellor said earlier this afternoon that savings of £6 billion had been secured from the Gershon efficiency review. That is extremely important because any Government have two duties: first, to advance new policies that will reform and change the country in which we live; and, secondly, to manage effectively the public services and administrative activities that are in the remit of the Government. Both duties are equally important, and the Gershon review goes to the heart of the second one. It is absolutely crucial that public services are run effectively and efficiently at the minimum cost to the public, not least because any savings that are made can be reinvested in services, can promote the greater quality of those services, or can be returned to the public through tax cuts. It is thus important that the numbers are right, and the work of the Public Accounts Committee, on which I serve, is very much geared to that end.
	However, when the Chancellor announced his £6 billion figure, it called to mind an earlier claim that he had made about Gershon savings. The Committee examined that. The right hon. Gentleman made the same claim in his Budget speech last year when he said:
	"I can report—ahead of target—the first £2 billion value-for-money Gershon savings".—[Official Report, 16 March 2005; Vol. 432, c. 260.]
	The trouble is that having looked into the basis of those savings, the National Audit Office found that they collapsed under scrutiny. The report published in February of this year said:
	"we conclude that most of the efficiency"
	savings
	"announced in March 2005"—
	in other words, by the Chancellor in the Budget—
	"were not based on clear audit trails and, from our understanding of the process through which the gains were collated, were not subject to adequate challenge by the Office of Government Commerce."
	That concerned me, and I was interested to find out what the exact process was that resulted in the savings.
	The inquiries that I made shocked me. So disbelieving was I that they could be true that when the Public Accounts Committee examined the Office of Government Commerce and the NAO on its report, I put to John Oughton, who heads the OGC, what I understood the process to be.I said at the Committee's hearing:
	"As I understand it, the process of collating this information involved the Treasury ringing round departments asking what savings they could offer up in time to be mentioned in the Budget with no checks at all."
	John Oughton said:
	"That is an accurate statement of the gains as they were reported in the spring of 2005."
	I may have been na-ve in my illusions about the process, and perhaps I expected the equivalent of my senior partner to be there, jabbing his accusing finger at the numbers, but for the NAO to discover that only half the savings stood up to scrutiny, and for the head of the Office of Government Commerce to be forced to admit that, is shocking.
	That is not the only basis for concern about the numbers presented in the Chancellor's speech. Just as my presentation on breathing apparatus in the Argentinean pampas collapsed if one figure was found to be wrong, how can we have confidence in any of the many figures that he presented if the history of their scrutiny shows that they fall away beneath our gaze?
	The hearing also raised worrying questions about the substance of the Gershon review. I do not want to make political points about the review as an appropriate subject on which the Government should take a view. I genuinely think that it is extremely important, but the NAO advised us that commercial organisations might expect in an efficiency drive to identify about 10 per cent. of the relevant administrative costs as savings. The Gershon review proposed savings of only 2.5 per cent. I do not quibble with that; I merely compare it with practice in commercial organisations. However, it is important to achieve even that modest level.
	Again, when the NAO looked closely at the Gershon review, it discovered that most of the savings accounted for in the £21.5 billion ultimate total from Gershon came from projects that had started before the review was conceived. It is stretching credulity to regard them as being Gershon savings; that is what the NAO found. When I questioned the Comptroller and Auditor General in the PAC on his assessment of the quantity of new money—the real savings that were being made under Gershon—I discovered something even more shocking.
	The NAO established a sum of 20 projects under the Gershon review that it looked at in detail. That sample was designed—I asked Sir John Bourn about it directly—to be representative of the whole, as is any sample. Any auditor would choose a sample on that basis, and Sir John confirmed that. Of that sample, the NAO was able to say that, of the ongoing efficiency savings, only between one and three were in any sense new and engaged in subsequent to the commissioning of the Gershon review. On the basis of that sample, 85 per cent. of the funding improvements that the Chancellor presented last year and, indeed, this year as possible do not merit the flourish that he gave them. They were the normal, embedded efficiency savings that Departments were already engaging in. That again gave me great cause for concern.
	The final point that I wanted to raise in this Budget debate, since the Chancellor chose to talk about having achieved £6 billion-worth of Gershon efficiency savings, is their reliability and robustness. The Office of Government Commerce helpfully makes an assessment of the deliverability of each of the savings by Department, and ranks them in four categories. Red means that there are grave concerns about deliverability, and green that there are good prospects that the savings will be delivered.
	The NAO had access to that information and helpfully reproduced in a series of pie charts in its report how many projects fell into each of the four categories of deliverability. It was drawn to my attention that there seemed to be a misprint in the charts, because there were only three segments to the pie. It was only on looking at the small print to the key to the table that it became apparent that that was so because, as at December 2005, there were no projects in any Department that were rated green as having good prospects of being delivered. Therefore, far from the Chancellor's being able to bank on, boast about and flourish the £21.5 billion-worth of savings in his Budget statements, the truth is that there is extreme risk that they will be delivered. The evidence for that is reported by the Office of Government Commerce itself.
	In reviewing the question, the NAO said:
	"We have significant concerns over whether the adopted measurement methodologies can be relied upon to substantiate efficiency gains effectively . . . Only a few departments recognise the potential risks from double-counting, cost-shifting and additional operational costs."
	Far from being numbers that can be relied on, that are cast iron and that have the imprimatur of the Chancellor, as I assumed if reported in a Budget, they are deeply suspect and so should be treated with the greatest of suspicion.
	What is to be done about this? I would have hoped that the Chancellor might exercise the senior partner role and interrogate the figures. He could have taken them to the Prime Minister, who could have asked some searching questions—although the Chancellor might have asked some searching questions of the Prime Minister, so perhaps that conversation was not going to happen. In the presence of such difficulties, who better to certify that the numbers are above board and accurate than the Comptroller and Auditor General—the head of the National Audit Office, Sir John Bourn?
	All Members would recognise that Sir John is an unimpeachable figure of great expertise and familiarity with Government figures. Indeed, he has published today an audit of assumptions on the forecasts in the Budget. The Red Book lists at great length the assurances that he has been able to give on factors such as the dating of the cycle, privatisation proceeds, the trend rate of GDP growth, UK claimant unemployment, interest rates, equity prices, VAT receipts and so on. Sir John Bourn rightly signed off those variables as above board and put them into the public domain. What more reasonable request could there be than to ask that he look at and validate Gershon efficiency savings before they are deployed by the Chancellor? I urged the Chancellor to do so at the last Treasury questions, suggesting that there was plenty of time before the Budget to ask Sir John to look at the savings. I raised the matter at a hearing of the Public Accounts Committee, and Sir John told me that he was ready, willing and able to conduct such an audit before the Budget. He said, too, that it would be a good idea to provide that assurance to the House.
	The Chancellor cited £6 billion of Gershon savings today. I rang Sir John Bourn this morning to see whether the Chancellor had availed himself of his kind offer. I am afraid that Sir John is probably still waiting by the phone, as his invitation has not been taken up. Once again, the numbers that the Chancellor presented as definitive Gershon savings have not been signed off by the National Audit Office. On previous form, the House must regard them as provisional and treat them with grave suspicion.

Brooks Newmark: Listening to the Chancellor's Budget one would think that he was living in a parallel universe, not the real world. I became an MP last May, and the House will not be surprised that, as a business man turned politician, I will look at the Budget from the perspective of a business man. I draw Members' attention to my list of interests in the Register of Members' Interests.
	While it is tempting to undertake a SWOT analysis of the Budget, I would prefer to look at it in a different context. How well prepared is Britain or UK plc to meet the competitive challenges posed by fast-developing countries such as India and China—an issue acknowledged by the Chancellor? Turning first to the economy, I assume that the Chancellor's heading for the 2006 Budget—"A strong and strengthening economy"—is ironic, because the evidence indicates otherwise. After he downgraded his growth forecast twice last year, UK growth was finally estimated to be 1.8 per cent., which is significantly below the growth rates of China, India and United States. Moreover, we came a poor 19th among 25 EU member states.
	In the World Economic Forum league of competitiveness, we dropped from fourth to 13th. Not surprisingly, we face a record trade deficit of £47 million. Businesses are voting with their feet, as they face increasingly inflexible markets, greater regulation and higher taxes. Google and Apple—the businesses of the future—have both chosen to set up their operations in Ireland rather than the UK. Productivity growth is now only 0.4 per cent.—the lowest in more than 15 years. Worse still, public productivity, as we have heard, is falling. Business investment, which fell to 9.1 per cent. of GDP in the last quarter of 2005, is now the lowest since 1965. Overall, the Chancellor is failing on all the long-term drivers of prosperity.

Mark Todd: I must have missed that. I was watching the clock during my hon. Friend's lengthy contribution, but I missed that particular element of his speech. Support for the FE sector, which is often relevant to the development of business skills, is particularly important in an area such as mine.
	I want to conclude by briefly reflecting on an issue that is relevant to the speech made by the hon. Member for Braintree (Mr. Newmark), namely the position of the UK economy in the world economy. We have no grounds for being complacent—I do not think that the Chancellor was, and I am certainly not—but we are now better placed than most other western European countries in that regard. That is partly for reasons of history, which I shall touch on briefly, and partly because of what the Government have achieved over the past nine years. The Opposition have naturally drawn out the fact that we have started to see a blip in productivity performance during the past 12 to 18 months, but, before that, an established performance of productivity improvement allowed us to move up the league table, certainly in western Europe, and to keep pace with the USA. I listened with interest to the speech of my hon. Friend the Member for Nottingham, South (Alan Simpson), who remarked on productivity performance. The best-performing country in productivity terms is the USA. I am not sure that he was necessarily commending that model to us, but I did not want to intervene on him to ask him to clarify that.
	Secondly, we have had the longest period of consistent growth in my lifetime—I do not know about the time of Vansittart and the Napoleonic wars—and, I would imagine, in the lifetime of most other people in this country. Again, that has placed us in a much stronger position in relation to other economies than, say, France, as a comparator.

Ann Widdecombe: I am grateful for the opportunity to have this Adjournment debate tonight and I also wish to record my gratitude to the usual channels on the Government side who ensured that I knew that I had to be here somewhat earlier than I might have predicted.
	I am raising this matter tonight because it is an extremely grave one for the 36 Engineer Regiment and for the town that I represent. It is an irony that 19 years ago I had to fight exactly the same battle when it was proposed to move the regiment from Invicta barracks in Maidstone to, at that time, Thorney Island. It was a bleak prospect and the town and regiment rebelled. I am pleased to say that we secured a reversal of the policy.
	It would seem that yet again we are threatened with the removal of the 36 Engineers from Maidstone. I am sure that the Minister will accept that it is very important that morale is kept as high as possible in an Army that is stretched as badly as it is at the moment. Part of the maintenance of good morale is ensuring that families are happy, especially when the forces have to serve overseas for any length of time.
	The 36 Engineers is a sapper regiment, so almost by definition it spends a large amount of time abroad and has one of the highest rates of separation from spouses and families in the entire Army. It is thus essential for recruitment and retention that the soldiers can go away feeling that their wives and families are happily integrated in the local community. In turn, the wives have considerable influence over whether their husbands decide to stay in the Army. It follows that if there is general unhappiness with the serving conditions, the soldiers will not give a particularly happy account to potential recruits.
	In Maidstone, the 36 Engineer Regiment is based near the centre of a large town, which offers not only good shops but extremely good schools, including the envied grammar schools, and many opportunities for wives to work. The Gaffney report described the regiment's relationship with the town as "ideal" for a major unit. It is. Super-barracks are no substitute. They would need to be built and maintained, and would be costly. The regiment currently enjoys the freedom of the town, and the citizens of Maidstone and the surrounding areas regard the Army with immense gratitude following its intervention, first, after the 1987 wind storm when we had to clear roads urgently and, secondly, during the floods which, the Minister may recall, devastated parts of my constituency a few years ago.
	The Minister appears remarkably unmoved by all that, however. I shall quote from a recent letter from the Secretary of State for Defence. He said:
	"I should tell you that the Army is committed to consolidating its estate into fewer and larger sites. As a result, a singleton site such as Invicta Park Barracks will be kept under review for possible disposal in the longer term. I should stress that no specific time lines have been established for this process but the points you make regarding the presence of 36 Engineer Regiment in the area will be taken into account."
	We should look at the context for that proposal to dispose of sites. On 21 July 2004, the then Secretary of State for Defence announced to Parliament what he described as a "radical change" in the future force structure. Since 1997, the trained establishment has actually declined by about 6 per cent. at a time when the reserve has fallen by nearly 68,000, including a fall of 20,000 in the Territorials.
	The cuts make no sense at all, given what we require our armed services to do. We should have taken notice of the recent situation when we wanted both to deploy troops in Iraq and to keep them on standby during a firemen's strike. From talking to members of the 36 Engineer Regiment, I know that that placed considerable strain not only on their resources but on the ingenuity necessary to manage both operations.
	The cuts should be reversed. We should be making sure that we have a properly manned force rather than a reduced one that is operating with a reduced reserve. In the last 12 months, the outflow from the Army has exceeded the inflow by about 3,500, which led my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) to tell the Prime Minister that as our forces were so overstretched it was hardly the time to cut four battalions from the Army.
	Since the last time we went round this course, that proud regiment has fought in both Gulf wars and has been involved in every other conflict. The Secretary of State for Defence has said that there is no specific time scale, but I think that he means by 2012, which is the time to which the Army is operating in considering the creation of super-barracks and the disposal of sites. Of course, 2012 is a mere six years away. The loss of the regiment would be a severe loss to Maidstone. Although I appreciate that this is not the Minister's direct worry and that it is more properly the concern of the Deputy Prime Minister, it would a very great worry to Maidstone if that site were replaced by development.
	Our infrastructure is already extremely pressured. We do not have enough water. We do not have sufficient roads. Our schools and certainly our health services are stretched and, of course, we have to face up to the huge extra developments being foisted on us by the Deputy Prime Minister. If we were also confronted by a major site, such as Invicta barracks, being covered by housing development, it would be a great deal more than Maidstone could stand.
	Quite apart from those worries, we want to keep the regiment in Maidstone, as we wanted to do in the late 1980s, when we faced the same threat of removal but for different reasons. We want to keep it because we are proud of it. We are particularly proud of the Gurkhas. We want to keep it, because it makes a major economic contribution to Maidstone and because we believe that we, in turn, provide the Army with a very good background against which troops can go abroad satisfied that their families are fully integrated into the local community. Our schools would be regretful if those children were suddenly to disappear to super-barracks somewhere else.
	The creation of vast Army sites is not a substitute for a major unit in close association with the town in which it is stationed. I ask the Minister to think again. It would be very optimistic of me to think that he would give me every reassurance that I have sought tonight, because that is rather unlikely, but I hope nevertheless that he will, at the very minimum, agree to visit the 36 barracks at Invicta and talk to the officers and men and, of course, the Gurkhas who are involved there. I hope that he will also consent to hold conversations with Maidstone borough council about the impact on the town if that Army site is disposed of and the force sent elsewhere.
	The 36 Engineers have been associated with Maidstone for more than 60 years—a long association that has been fruitful both for the regiment and, indeed, for the town. I therefore very much hope that some singleton sites will not be disposed of—a few must survive—and I should be grateful to the Government if Invicta barracks were among the few that survive.